Channel 4 and Group M reach £500m two-year deal

Channel 4 and Group M have agreed an estimated £500 million two-year trading deal, avoiding a repeat of their showdown in 2013 when Britain's biggest media buyer pulled its clients off the broadcaster.

As part of the new deal, it is thought that Group M and its content arm, Group M Entertainment, will supply Channel 4 with some advertiser-funded shows in a similar way to the previous deal.

Group M controls about 30 per cent of the TV ad market and spends an estimated £250 million a year with Channel 4 whose sales house has an annual turnover of nearly £1 billion.

Channel 4 and Group M declined to comment.

Back in 2013, Channel 4 sales director Jonathan Allan and Group M head of broadcast trading Mark Collins issued a joint statement after the "long and complex" negotiation to resolve their stalemate.

State-owned Channel 4 is in a stronger position now as share of peak-time viewing between 8pm and 11pm is up about 7 per cent in the year to date, and the wider TV market has seen revenues rise strongly by around 8 per cent.

Group M is forecasting another strong year for TV next year, with revenue growth of around 7 per cent, and media buyers have fewer options if they want to boycott a TV ad sales house to win better terms.